Coronavirus Job Retention Scheme guidance hub for employers and employees

The Coronavirus Job Retention Scheme is a temporary scheme from 1 March to 31 October 2020 (having been extended a number of times). It is designed to help employers whose operations have been severely affected by COVID-19 to retain their employees and protect the UK economy.

The Government launched the portal on 20 April 2020 and payments have been made within 6 working days. The claim will need to be made online and will be accessed through the Government Gateway. Your payroll agent may be able to make the claim for you.

From 1 July 2020, businesses have the flexibility to bring furloughed employees back part time. This is a month earlier than previously announced to help support people back to work. Individual firms will decide the hours and shift patterns their employees will work on their return, so that they can decide on the best approach for them – and will be responsible for paying their wages while in work. However, the scheme closed to new entrants at the end of June (with the exception of military reservists and those returning from statutory parental leave). Full details on the changes from 1 July 2020 can be found here.

From August 2020, the level of Government grant provided through the Job Retention Scheme will be slowly tapered to reflect that people will be returning to work. The scheme updates mean that the following will apply for the period people are furloughed:

  • June and July: The Government will pay 80% of wages up to a cap of £2,500 as well as employer National Insurance (ER NICS) and pension contributions. Employers are not required to pay anything.
  • August: The Government will pay 80% of wages up to a cap of £2,500. Employers will pay ER NICs and pension contributions – for the average claim, this represents 5% of the gross employment costs the employer would have incurred had the employee not been furloughed.
  • September: The Government will pay 70% of wages up to a cap of £2,187.50. Employers will pay ER NICs and pension contributions and 10% of wages to make up 80% total up to a cap of £2,500. For the average claim, this represents 14% of the gross employment costs the employer would have incurred had the employee not been furloughed.
  • October: The government will pay 60% of wages up to a cap of £1,875. Employers will pay ER NICs and pension contributions and 20% of wages to make up 80% total up to a cap of £2,500. For the average claim, this represents 23% of the gross employment costs the employer would have incurred had the employee not been furloughed.

Employers will be required to submit data on the usual hours an employee would be expected to work in a claim period and actual hours worked. Employees who believe they are not getting their 80% share can also report any concerns to the HMRC fraud hotline. HMRC will not hesitate to take action against those found to be abusing the scheme.

Helpful graphics of the of the month by month changes to the Job Retention Scheme from 1 July can be seen here, while a graphic of key dates can be seen here. Employees will continue to receive 80% of their salary (capped at £2.5k) but employer contributions increase from August. Claims relating to the period up to 30 June 2020 must be completed by 31 July 2020. It is now possible to make claims for periods relating to 1 July onwards.

CTG’s Coronavirus Job Retention Scheme guidance hub collates links to:

HMRC will check claims made through the scheme. Payments may be withheld or need to be repaid in full to HMRC if the claim is based on dishonest or inaccurate information or found to be fraudulent. Dishonest or deliberately fraudulent claims put our essential public services and the protection of livelihoods at risk during these challenging times. HMRC has put in place an online portal for employees and the public to report suspected fraud in the Coronavirus Job Retention Scheme.

If your charity has made a claim for furloughed workers, we would welcome feedback on your experience at [email protected].